Rackspace Technology, Inc. · NASDAQ:RXT
Rackspace Technology — Debt Investor Presentation (March 2024)
27 slides from Rackspace Technology's debt investor presentation, Mar 12, 2024
Slide 1: Rackspace Technology Lender Presentation January 2024
Rackspace Technology Lender Presentation January 2024 Exhibit 99.3
Slide 2: Confidentiality Undertaking and Disclaimer
Disclaimer 2 Confidentiality Undertaking and Disclaimer This presentation, including the information contained herein and the materials accompanying it, constitutes confidential information and is provided to you on the condition that you will hold it in strict confidence and not reproduce, disclose
Slide 3: Disclaimer: Preliminary Results and Non-GAAP Measures
Disclaimer 3 Preliminary Results The 2023 fiscal year financial information included in this presentation is preliminary, has been prepared by Rackspace Technology’s management, has not been reviewed or audited by our auditors and represents the best estimates of management based on the information
Slide 4: Executive Summary (1 of 2)
Executive Summary (1 of 2) 4 • Beginning in late 2022, the company embarked on a mission to transform the business to better align to the strengths of the company and build upon the foundation that made Rackspace successful • Starting at the top, Amar Maletira, former CFO, was promoted to CEO and Sh
Slide 5: Executive Summary (2 of 2)
Executive summary (2 of 2) 5 • 2023 was a year of transformation, separating the company into two BUs and refreshing talent both at a management and sales level • We have begun to see tangible benefits from the shift in strategy…but we are in the early innings: • The strategy to de-emphasize low mar
Slide 6: Global reach, differentiated expertise and evolution
Americas 2,500+ employees EMEA 900+ employees APJ 2,300+ employees OUR DIFFERENTIATED EXPERTISEOUR GLOBAL REACH 5,700+ Employees globally 20k Customers 120 Countries 168 PB Storage managed 35+ Datacenters 2,600+ Certified technical experts 9,500+ Total technical certifications Rackspace delivering v
Slide 7: Rackspace has many strengths
TECH PARTNER ECOSYSTEM Rackspace has many strengths ….. 5,700+ Dedicated Rackers Global Footprint 10,000+ Certifications PEOPLE Trusted Recognized History of innovation BRAND 20,000+ Customers 50+ in Fortune 100 7 3 Awards ReInvent PE PLE CUSTOMER BASE
Slide 8: Turnaround progress and recent challenges
• Reorganized into two-business unit operating model and strategy – shifting to a more profitable business mix, right sizing our cost structure, and building our product offerings to position Rackspace for long-term success • Making targeted investments to drive future growth in key market vertical
Slide 9: Key goals for Rackspace turnaround
Key goals for Rackspace turnaround Foundation for the best-in-class pureplay Multicloud + AI solutions company Commit to delivering long-term sustainable cash flows to meet capital structure obligations 2 3 9 Financial turnaround will take ~24 months, as we get into an operating rhythm and tackle Te
Slide 10: Attractive end markets: Public, Private and Edge workloads
Attractive end markets with Public, Private & Edge to be net recipients of workloads as customers implement their digital transformation agenda 10 Edge Hosted Private Cloud Customer Data Centers / on-premise Public CloudNew cloud native workloads Workloads that require on-demand scaling, and rapid i
Slide 11: Two growing cloud markets: Public and Private
Rackspace organized around these two very attractive and growing cloud markets 11 15%+ 3-year CAGR 20% current workloads 3-5% 3-year CAGR 10% current workloads Public Cloud Private Cloud $150B Market $50B Market Growth market Product-centric CAPEX heavy Growth market Services-centric CAP
Slide 12: Strategy focused on capturing multicloud market opportunity
Our strategy is focused on capturing multicloud market opportunity Private Cloud • Rackspace SDDC • NextGen Private Cloud (containers/ Openstack) • Industry Cloud • Emerging Cloud: Sovereign, AI, Edge DE F E ND AND EXPA N D with new solutions 1 • Defend commercial • Expand into mid-market • Selectiv
Slide 13: Strong and seasoned leadership team
Execution starts with a strong and seasoned leadership team Bobby Molu: Chief Financial Officer • Years Experience: 25+ Brian Lillie: President – Private Cloud • Years Experience: 35+ Amar Maletira: Chief Executive Officer • Years Experience: 30+ DK Sinha: President – Public Cloud • Years Experience
Slide 14: Experienced leaders driving execution in dynamic markets
Experienced leaders driving execution in these dynamic markets Secular growth market Services-centric with deep customer engagement Capital-light Mature / low-growth market Technology-forward Capital-intensive Infrastructure-as-a-service Industry solutions Next-generation solutions: AI cloud, Sovere
Slide 15: Private Cloud
Private Cloud technology.
Slide 16: Our private cloud strategy supports our vision and goals
Our private cloud strategy supports our vision & goals E X PA N D S O L U T I O N O F F E R I N G S B U I L D G O T O M A R K E T S U C C E S S Bring Compelling Solutions to the Market Radically Improve Sales (IB & New Acq) N U R T U R E G R E E N S H O O T S ; E M E R G I N G B U S I N E S S T R A
Slide 17: Key factors driving buyers of private cloud
Key factors driving buyers of private cloud products and services Cost of maintaining on-prem data centers Shortage of infrastructure skills Data sovereignty and compliance $10M to $25M The average yearly cost to operate a large data center.1 1. How Much Does Running A Private Data Center Cost Per Y
Slide 18: Private Cloud business unit long term plan
Private Cloud business unit long term plan LEVERS Industry Private Cloud offerings (Healthcare, BFSI, Tech, Oil & Gas) Major Product launches each year with agile product lifecycle management Emerging businesses at scale (e.g., Healthcare, HPC/AI) Scaled GTM partnerships (e.g., Dell, BT, VMware, Nvi
Slide 19: Recent Customer Win Case Study: Apria
Recent Customer Win Case Study Apria leaves the data center to improve customer experience and increase savings 19 About Apria Apria Healthcare is one of the leading providers of home respiratory services and related medical equipment in the US. Their challenge After being DIY for most of its existe
Slide 20: Public Cloud
Public Cloud technology.
Slide 21: Public Cloud market trends
21 Public Cloud revenues have grown 10x in the past 3 years from $15B in 2018 to $150B in 2022 However, 85% of workloads are still on Private Cloud and On-prem Data Centers Most IT leaders (+ 80%) say they have a Multicloud Strategy Fast followers can learn and evolve from early adopters by consider
Slide 22: Capturing our fair share of the market in cloud services
22 Capturing our fair share of the market in cloud services Source: Cloud Wars Top 10 Q1 2023 Professional Services Managed Services Elastic Engineering Future TAM of $1 Trillion+ for Cloud Infrastructure $114B$85B $35B Hyperscaler 2023E TAM Cloud Services Annualized 2027 TAM $250B+
Slide 23: Public Cloud business unit long term plan
Public Cloud business unit long term plan 23 Gross revenue from professional services & managed services30-35% 60%+ Revenue from T-100 accounts with 10+ accounts with $10M+ revenue ‘Referenceable’ services transformations w/ marquee clients5-10 LEVERS
Slide 24: Consolidated Financial Overview
Consolidated Financial Overview
Slide 25: Simplifying our business and capital allocation
We are focused on simplifying our business and capital allocation 25 Business simplification • We simplified our business to focus on a two-business unit structure, Public Cloud, and Private Cloud to better leverage the unique competitive advantages of each business Disciplined balance sheet managem
Slide 26: Business Plan Overview
Business Plan Overview 26 • After implementing the structural and organizational changes in the FY 2023, 2024 will be a pivotal year where growth in bookings will be the focus and will determine the future trajectory of the company • 2024 bookings will start to be reflected in late-2024/2025 revenue
Slide 27: Rackspace Technology
rackspace technology.
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